by Scott McClallen
The Michigan Legislature is supposed to make laws and spend taxpayer money wisely and transparently.
But a report from the Detroit News says the GOP-led Legislature gave $4 million to a for-profit company, with an unclear return on investment for taxpayers. The details of the corporate handout weren’t discovered until months after the appropriation.
The funding flowed to a mobile cardiac imaging venture called Corazon Imaging, owned by southeast Michigan healthcare executives Joshua Katke and Abir Mehanna.
The company was formed on March 1, 2022. It received $4 million in July, just months later as part of a $1 billion spending package rammed through overnight with little explanation or oversight as part of the $76 billion budget.
Former House Speaker Jason Wentworth, R-Farwell, sponsored the grant.
The News reported that the House Appropriations Committee’s office said last year the project was meant to serve northern Michigan.
A Senate report notes $4 million was reserved for the company. A budget bill said the grant was meant to provide to underserved populations scans and virtual cardiac consultations and the “acquisition of a facility and the creation of at least 20 jobs.”
Katke told the News that the taxpayer money would be used to “establish the 11 initial mobile clinic sites” for which the company is “hiring staff.”
The company said it plans to eventually provide services in Gaylord, Gladwin, and Alpena.
“These cities are not among the first markets Corazon Imaging is entering because they are still working through the process of securing Certificates of Need (CON),” the group said about state-issued licensing.
Wentworth told The News that the company had asked for between $8 and $10 million of taxpayer money.
“A key objective for Corazon Imaging is to make high-quality cardiac care accessible in underserved communities, while also reducing costs 30-50% in the outpatient setting,” Katke told the News in an email.
It’s yet to be known whether the company will actually provide the promised services. Typically, the Michigan Economic Development Corporation oversees economic development deals and ensures companies provide promised jobs in return for taxpayer money.
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Scott McClallen is a staff writer covering Michigan and Minnesota for The Center Square. A graduate of Hillsdale College, his work has appeared on Forbes.com and FEE.org. Previously, he worked as a financial analyst at Pepsi.
Photo “Michigan Capitol” by Catherine Ottarson. CC BY-SA 4.0.